The burden of proving that the amount of the transfer income tax based on the standard market price exceeds the transfer margin based on the actual transaction price.

In a case where transfer margin is calculated on the basis of the standard market price, the tax amount calculated on the basis of the standard market price cannot exceed the scope of the transfer margin based on the actual transaction price under the principle of no taxation without law or prohibition against excessive taxation under the Constitution. Thus, in a case where a party claims this purport, if the existence of the actual transfer margin and the actual transfer margin have occurred, after examining whether the tax amount calculated on the basis of the standard market price exceeds the scope of the actual transfer margin, the relevant tax amount shall be limited to and recognized as the scope of the actual transfer margin. In this case, the reason for a taxation disability that the tax amount calculated on the basis of the standard market price exceeds the scope of

Article 23 (4) 1 (see current Article 96 subparagraph 1), Article 45 (1) 1 (a) (see current Article 97 (1) 1 (a)) of the former Income Tax Act (Amended by Act No. 4661, Dec. 31, 1993); Article 170 (4) 3 (see current Article 166 (4) 3) of the former Income Tax Act (Amended by Presidential Decree No. 14083, Dec. 31, 1993); Article 8 (2) of the Administrative Litigation Act; Articles 187 and 261 of the Civil Procedure Act

Supreme Court Decision 84Nu362 delivered on March 12, 1985 (Gong1985, 553), Supreme Court Decision 89Nu2851 delivered on February 13, 1990 (Gong1990, 686), Supreme Court Decision 94Nu3407 delivered on July 14, 1995 (Gong1995Ha, 2829), Supreme Court Decision 96Nu860 delivered on February 11, 1997 (Gong197Sang, 805)

Plaintiff (Law Firm Hanma, Attorney Kim Si-young, Counsel for plaintiff-appellant)

Head of Suwon Tax Office

Seoul High Court Decision 96Gu47793 delivered on July 25, 1997

The appeal is dismissed. The costs of appeal are assessed against the plaintiff.

We examine the grounds of appeal.

Article 23(4)1 and Article 45(1)1(a) of the former Income Tax Act (amended by Act No. 4661 of Dec. 31, 1993; hereinafter “the Act”) and Article 170(4)3 of the Enforcement Decree of the same Act (amended by the Presidential Decree No. 14083 of Dec. 31, 1993; hereinafter “Enforcement Decree”) declares that the transfer margin is converted from the previous taxation principle to the standard market price principle in calculating the transfer margin, and thus, it is interpreted to the effect that exceptions to the substance over form principle are recognized. Thus, in cases where assets are transferred, if evidential documents confirming the actual transaction value in the preliminary return of transfer margin or the final return of tax base are submitted, the court below shall calculate the transfer margin based on the actual transfer margin and acquisition value, or if there is no evidentiary document submitted at the time of such declaration or if the tax amount calculated based on the standard market price cannot be determined by the standard market price or the standard market price without taxation without law, its existence should be determined.

According to the records, the plaintiff acquired the land and the building on June 28, 1986 and voluntarily paid the transfer income tax of 320,820,000 won calculated according to the above amount on or around October 5, 1992 after removing the building and constructing the building on the site of this case along with the land of this case on November 5, 1992 after transferring the land of this case, and then transferring the land of this case on November 28, 1992, the real acquisition value of the real estate of this case was reported as 242,983,438, and the real transfer value was reported as 303,707,387 won. The plaintiff's assertion that there is no error in the misapprehension of the legal principles as to the transfer margin, since there is no error in the misapprehension of the legal principles as to the transfer margin, since there is no evidence to prove that there is no difference between the above report and the actual market value.

Therefore, the appeal is dismissed and all costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Lee Yong-hun (Presiding Justice)